With stocks on the rise, investor demand for newly minted public companies rebounded in 2013, making it the best year for IPOs since 2004.

Two recent reports – one from Ernst & Young and another by IPO-tracker Renaissance Capital – paint similar pictures of a broad based recovery in the initial public offering market – led by energy, health care, real estate and technology.

“Unlike five years ago, when for the most part tech companies were the only ones getting out, we now see pockets of activity in multiple sectors,” said Jackie Kelley, Americas IPO leader for Ernst & Young.

With just a few weeks left in the year, 222 companies are expected to go public in 2013 in the U.S., raising about $59 billion, according to Ernst & Young.

That’s up from 133 companies in 2012. The amount raised is forecast to increase 28 percent over the prior year.

In San Diego, the wide open IPO window allowed biotechnology companies to tap public markets after years on the sidelines. Seven local firms went public this year – all of them in the life sciences sector. That's up from three IPOs for San Diego companies in 2012 -- software firm ServiceNow, chip maker Peregrine Semiconductor and biotech Regulus Therapeutics.

“It was very good resurgence in that space in San Diego, and you had pockets of that going on in the Bay Area as well,” said Doug Regnier, who oversees Ernst & Young’s IPO practice in the West. “It has been a decade since you have seen this type of strong activity for these biotech companies.”

IPO performance beat benchmark indexes this year, with an average return of 35 percent, according to Renaissance Capital.

In San Diego, life science firms that went public this year posted mixed results. Shares of four of the seven companies – Fate Therapeutics, Tandem Diabetes, Ambit Biosciences and Receptos – are trading today above their initial offering price.

While life science IPOs had a good summer, investor demand diminished later in the year, resulting in a number of companies delaying planned IPOs, said Regnier.

“Some of the feedback we’re getting is that there are a lot of companies in this space,” he said. “Investors are being much more selective in their investments. You need the right story and the right timing.”

Regnier added, however, that he expects to see demand for biotech IPOs to continue to be relatively strong next year.

“There are a number of companies getting ready to file in 2014 up and down the West Coast and here in San Diego,” he said.

Nationwide, the IPO market is expected to remain strong, led by a backlog of private equity-owned firms going public. This year, 42 percent of U.S. IPOS were from private equity-backed companies, according Ernst & Young.

“There are some fairly aged investments in those portfolios that the private equity funds would like to get back on the public markets again,” said Regnier.

San Diego IPOs 2013

Seven San Diego County companies went public in 2013, all on the Nasdaq exchange. They are: